Abstract Structural kidney diseases are the leading causes of chronic pediatric kidney disease. Identifiable genetic mutations are present in only a small proportion of patients with congenital anomalies of the kidney and urinary tract, suggesting that environmental and epigenetic modifiers play an important role. Studies have demonstrated that exposure to intrauterine hypoxia results in a range of renal malformations, including decreased nephron number, depending on the timing and severity of the hypoxic stressor. The determination of nephron number is linked to the balance between self-renewal and differentiation of nephron progenitors. We propose that hypoxia is a critical component of the nephron progenitor microenvironment in maintaining ?stem-ness?, and that shifts in the oxygen tension of the stem cell compartment is mediated by development of the surrounding renal vasculature. The response of tissues to hypoxia is largely mediated by hypoxia inducible factors (HIFs), which are regulated by the ubiquitin ligase Von Hippel Lindau (VHL). We have demonstrated that changes in oxygen tension regulate the differentiation of vascular and nephron progenitors. Further, we show that conditional deletion of VHL in nephron progenitors results in stabilization of HIF-1? (simulating in vivo hypoxia specifically in the nephron progenitors) and a delay in nephron progenitor differentiation, subsequently leading to structural kidney malformations. We hypothesize that hypoxia is required to maintain and proliferate nephron progenitors. However, prolonged hypoxia beyond the normal length promotes renal malformation. Conversely, increases in tissue oxygen tension are necessary for normal differentiation of nephron progenitors.